From Yahoo Finance: 2025-06-16 06:07:00

US drugmakers are increasingly licensing molecules from China for potential new medicines, signing 14 deals worth $18.3 billion in 2024. This trend is expected to continue as they seek to rebuild pipelines, with China offering high-quality assets at more affordable prices compared to the US.

Pfizer spent $1.25 billion upfront for an experimental cancer drug from China’s 3SBio, while Regeneron Pharmaceuticals paid $80 million for an obesity drug from Hansoh Pharmaceuticals. The total cost of licensing agreements in the US over the past five years averaged $84.8 billion, compared to $31.3 billion in China.

Chinese companies are contributing nearly 30% to global drug development, with US drugmakers licensing experimental drugs for obesity, heart disease, and cancer. Analysts note a shift towards novel treatments, challenging Western peers, while traditional M&A activity has declined by 20%.

Despite US-China tensions, the pharmaceutical sector remains active in licensing deals. Analysts believe that tariffs will not impact yet-to-be-marketed products, as the law excludes intellectual property. By licensing drugs in development from China, US and European drugmakers gain quick access to valuable molecules.

Nuvation Bio’s acquisition of AnHeart Therapeutics allowed access to an experimental cancer drug that received US approval. The presence in China not only benefits R&D but also provides an inside track to grow the company with new therapies. Analysts highlight the cost-effectiveness and time-saving benefits of licensing deals in China.

Read more: US pharma bets big on China to snap up potential blockbuster drugs